The Fed Just Raised Rates to 3.75%–4%: What It Means for Financing Your Next Skid Steer or Track Loader

On September 16, 2026, the Federal Reserve raised its benchmark rate a quarter point to a target range of 3.75%–4%, the first hike since 2023. If you've been sitting on a decision about a new skid steer or track loader, waiting for financing to get cheaper, that decision just got a little more urgent. Here's what actually changed, what it means for a contractor financing equipment rather than a homeowner refinancing a mortgage, and why Bobcat happened to roll out one of its biggest compact loader lineups in years the same month.

What Actually Happened on September 16

The Federal Open Market Committee moved its target range from 3.5%–3.75% up to 3.75%–4%, reversing a run of rate cuts that had contractors and equipment buyers expecting borrowing to keep getting cheaper through the back half of 2026. Fed leadership, now under Kevin Warsh, cited inflation that's still running hotter than the committee wants. The market reaction was immediate: the Dow dropped roughly 600 points in the trading session heading into the decision, and the 10-year Treasury yield climbed back to 5% afterward. Just as notably, CNBC's own coverage the next morning flagged that this hike "might not be one-and-done" — meaning contractors banking on rates drifting back down before year-end may want to rethink that bet.

Why a Fed Move Actually Reaches Your Equipment Payment

A quarter-point Fed move doesn't instantly change the rate on the loan you already have, but it does move the floor under new financing. Equipment lenders price loans off the same benchmark curve that just shifted, so the rate quoted on a track loader application in October will generally run higher than one quoted in August. That's the opposite direction most buyers were hoping for.

Here's why it matters, without pinning to an exact quote: equipment lenders price loans off the same benchmark curve that just moved, so a track loader or excavator application priced after this hike will generally carry a modestly higher rate, and a modestly higher monthly payment, than the same application would have before it — and that gap compounds the larger the machine, the more the Fed moves, and the longer the term. None of that compares to what renting costs you over the same stretch, which is the whole comparison we walk through in our breakdown of total cost of ownership for renting vs. financing over 1, 3, and 5 years — renting was already the more expensive option before this hike; it's more expensive now.

Bobcat Picked a Strange Week to Launch 17 New Loaders

Coincidence or not, Bobcat used CONEXPO-CON/AGG 2026 to unveil what it's calling its next evolution of compact loaders — a sweeping refresh across 17 skid steer and compact track loader models, now sold in a choice of "Classic" or "Pro" trim depending on how much technology and comfort a crew actually needs on a given jobsite. The T86-2 Pro compact track loader and the T76-2 Pro (which we've covered in detail in our piece on what the Pro T76-2 changes from the R-Series T76) represent the shift: Bobcat retired the old R-Series naming across much of the line in favor of this new generation, and the T762 badge marks another model in that same refreshed family.

For excavation, demolition, and landscaping crews running Bobcat iron, the practical takeaway isn't that every machine changed overnight — it's that Bobcat is actively investing in this class of equipment while financing costs are also moving. If your fleet plan already included a compact track loader upgrade this year, that's two forces pointing the same direction: better machines are available now, and the cost of borrowing to get one is unlikely to get cheaper by waiting. We go deeper on how the new Pro trims stack up against Caterpillar's compact track loaders in our Caterpillar vs. Bobcat compact track loader comparison if you're cross-shopping brands before you commit.

This isn't a one-size-fits-all machine, either. A T86-2 Pro or T762-class compact track loader shows up on demolition sites clearing debris and knocking down interior walls, on landscaping and site-development crews grading and moving material where a full-size dozer would be overkill, and on utility and underground contractors backfilling trenches between excavator passes. General contractors running multiple subs on the same site often keep one in the yard just to keep everyone else moving. That range of use is exactly why a rate move that adds even a modest amount to the monthly payment matters — this is a machine that earns its keep across almost every job type on your schedule, so the financing terms on it affect more than one line of business.

Fixed Rate vs. Waiting on a Variable One

Some buyers hear "rates went up" and assume the smart move is to wait for the next cut. That only works if you're confident the next move actually is a cut — and right now, the Fed itself isn't projecting that with much confidence. A fixed-rate equipment loan locks in your payment for the life of the term regardless of what the FOMC does at its next meeting. If more hikes follow this one, you're protected. If cuts eventually come, you're no worse off than a buyer who financed today, and you've had the machine earning revenue the whole time you'd otherwise have spent waiting.

The Case for Locking In Now Instead of Waiting on a Better Rate

We hear the same reasoning from contractors every time rates move: "I'll wait until things settle down." The problem is that renting doesn't pause while you wait — you're still paying every week for a machine you'll never own a piece of, and that rental cost typically climbs right alongside everything else in this market. A financed machine, even at today's slightly higher rate, starts building equity and tax position from day one. Speaking of tax position, if you close before year-end, a track loader purchase may qualify for Section 179 and bonus depreciation, which can offset a meaningful chunk of the cost on your 2026 return — confirm the specifics with your tax professional, since eligibility depends on your business's full year of purchases and income.

This is exactly the kind of moment where the difference between a lender and a real financing partner shows up. A lot of finance companies just quote you a rate and disappear until the next payment is due. We'd rather structure a deal that fits your actual bid calendar and help you plan the next machine while this one's still being paid down — not make you wait five-plus years until it's paid off before we'll talk to you about growing the fleet. If you're carrying an older, higher-rate loan on existing equipment, it's also worth a look at whether refinancing what you already owe could free up room in your monthly cash flow before you add anything new.

Bottom Line for Contractors Watching Rates This Fall

The Fed's September 16 hike to 3.75%–4% doesn't change what a skid steer or track loader can do for your business, but it does change what it costs to borrow for one — and the direction of that change is up, not down, for now. If a compact loader upgrade was already on your radar, especially with Bobcat's new Classic/Pro lineup putting fresh iron on dealer lots, pricing your financing today rather than in a few months is the more defensible move. Check our 2026 skid steer and track loader buyer's guide for a fuller look at what's changed across Bobcat, Caterpillar, Kubota, and John Deere before you decide which machine fits your crew.

Ready to Move on This Before Rates or Tariffs Move Again?

Waiting rarely makes equipment cheaper in a market like this one. Apply for equipment financing and get a real answer in days, not weeks. Looking to add to your fleet without paying today's sticker price? Browse our current excavators, dozers, backhoes, and loaders for sale. Have a machine sitting idle? List it on the same page for free. And if you just want to see what else we're financing and who we work with, start at our homepage.